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10 Most Profitable Essential Oil Extraction Business Ideas

Essential oils have a great market globally. Additionally, the demand is increasing very fast. Essential oils ensure lucrative margins. Therefore starting an essential oil extraction business is a lucrative venture for entrepreneurs. Here in this post, we put a list of chosen 10 essential oil extraction business ideas for your ready reference.

According to market experts, the essential oils market is expected to reach USD 13.94 billion by 2024. Consumer interest is growing very fast. And there are several reasons behind it. Increasing awareness and willingness to buy organic and natural products are major reasons for the essential oils industry’s growth. Additionally, the shift of focus from synthetic to natural products is likely to trigger market growth.

Apart from the domestic household demands, the products receive a great industrial demand also. Cosmetics, pharmaceuticals, food, and beverage industries are major consumers of different essential oils. Numerous other advantageous product properties such as antiseptic, aphrodisiac, anti-inflammatory, antidepressant, antispasmodic, diuretic, and tonic are expected to boost essential oil demand in industrial, medicinal, and domestic applications.

List of 10 Essential Oil Extraction Business Ideas

#1. Basil (Ocimum basilicum)

Basil is a very high-value essential oil. The product has already a great demand. In addition, the demand is increasing. Generally, people use basil oil for several reasons. This oil soothes sore muscles and joints, assists with clear breathing, and acts as a cooling agent for the skin.

In addition, it promotes mental alertness and lessens anxious feelings. Basil oil has high economic value due to the presence of specific substances such as estragole, lineal, linalool, eugenol, methyl cinnamate, limonene, and geraniol.

#2. Chamomile (Matricaria Chamomilla)

You can produce chamomile oil from the flowers of the Camomile plant. It is very popular as a flowering plant. Generally, chamomile oils have a lot of benefits in skincare and personal care. The oil is good for acne and eczema. Additionally, it makes the skin young, moisturized, and blemish-free.

In addition, the oil is good for hair care also. Therefore, oil has an increasing demand in the beauty and personal care industry.

#3. Clove (Eugenia Caryophyllata)

You can produce clove oil from the flowers, flower stalks, and third leaf. The most economical section is an extract of the leaves. The main component of clove oil are terpenes and their derivatives.

This is an important component in industrial activities such as perfumes, flavors, pharmaceuticals, paints, plastics, and others. Generally, you can use the distillation method to produce clove oil.

#4. Eucalyptus (Eucalyptus Globulus)

Eucalyptus oils are clear liquids with aromas characteristic of the particular species from which they are obtained. Like other essential oils, they are mixtures of organic compounds (mainly terpenes).

Generally, the composition of the oil depends on genetic rather than environmental factors. You can start eucalyptus farming with moderate capital investment.

#5. Lavender (Lavandula Angustifolia)

Distillation is the best process to produce lavender essential oil. Lavender is a small, aromatic shrub used in the fragrance, specialty food, and alternative medicine industries. More than 30 different types of lavender oils and blends are traded on world markets. For commercial lavender oil production, you will need to go through the steam distillation process.

#6. Lemon Oil (Citrus limon)

Lemongrass oil is an important essential oil. As the demand for aromatic cosmetics is increasing, the demand for this oil is also growing. Lemongrass oil has a strong lemon-like odor due to its high citral content (75-90%). The minimum commercial requirement is 70% citral content.

The major quality checking measures are its citral content and its solubility in alcohol. This is an essential ingredient in toiletry products such as toilet soaps, bath salts, etc.

#7. Orange Oil

Orange oil emerged as the major product and accounted for 29.4% of total market volume in 2015. It is also expected to witness the highest growth rate over the forecast period. Increasing orange oil demand in food & beverages, personal care, and cleaning agents is expected to foster the segment growth. You can produce orange oil from cells within the rind of an orange fruit.

#8. Peppermint (Mentha Piperita)

Generally, you can produce mint oil by chilling mint oil and subsequent centrifuging to separate out the menthol crystals. The process may be divided into two steps.

Firstly, you produce menthol flakes by chilling mint oil. And secondly, you mix the menthol flakes with mint oil again chilled to produce bold crystals of menthol. Basically, the food, cosmetic and pharmaceutical industries are the major consumers of this product.

#9. Rosemary (Rosmarinus officinalis)

Rosemary has a woody, evergreen-like scent and is part of the mint family. Generally, this oil improves memory, soothes digestive uses, and relieves muscle aches and pains. The world’s production and
consumption of rosemary essential oils and perfumes are increasing very fast. However, the production technology is an essential element to improve the overall yield and quality of essential oil.

Read: How to Start Neem Oil Extraction Business 

#10. Sandalwood (Santalum album)

Hydro, or water, distillation is the traditional method of extracting sandalwood essential oil. Instead of steam passing through the powdered wood, in hydrodistillation, the powdered wood is immersed in water to soak.

India was once one of the largest sandalwood oil producers in the world. China and Australia also major producers of sandalwood oil globally. Generally, cosmetics and perfumery industries are the major consumers of sandalwood essential oil.

Steps to Start an Essential Oil Extraction Business

Commercial essential oils extraction demands a strategic financial and marketing plan. Basically, you will need to concentrate on production, distribution, marketing, and sales promotion.

Secondly, do some market research prior. Identify the local demand for specific essential oils. In addition, identify the source of raw materials.

Essential oils extraction is a capital-intensive business. So, it is advisable to start the business with a bank loan. Additionally, you can consider taking help from other financial institutions.

Check your state’s law carefully. Obtain the required licenses and permissions from the concerned authority. Additionally, identify the upcoming tax liabilities.

Establish the essential oils manufacturing plant carefully. If you have extra space, you can start the business from home.

Carefully choose the machinery. Procure the right machinery according to the desired production output and quality.

Capital investment, transportation, and labor considerations (cost and availability) dictate the essential oils production industry. Therefore, carefully calculate the break-even and expected ROI.

Finally, source the manufacturing technology from a reliable source. Generally, Govt. research centers provide manufacturing technology in exchange for certain fees.

Essential oils have a great soothing and calming effect on the nervous system and are also beneficial in blood circulation stimulation. Asia Pacific essential oil market is expected to grow at an estimated CAGR of 9.0% from 2016 to 2024 to emerge as the fastest-growing regional market.